The Webjet Limited (ASX: WEB) share price is creating fresh 6-month highs on Thursday thanks to America’s plans to reopen its international borders.
In early afternoon trade, the Webjet share price hit a high point of $6.23. This is a 5.23% bump on yesterday’s closing price of $5.92 and a new 6-month high for the ASX travel share.
At the time of writing, the price has settled back to $6.18, which is a 4.39% gain.
International restrictions to ease by November
The White House announced on Monday that it will lift travel restrictions for fully vaccinated travellers from 33 countries, according to Reuters.
These countries include most of Europe, China, India, Brazil, Iran, and South America. Unfortunately, the list did not include Australia.
Reuters reported upbeat commentary from airlines such as British Airways, which said that its customers were “keen to fly again”. The airline reported an almost 700% jump in searches for holidays to US destinations on its website, following the White House announcement.
How does this impact the Webjet share price?
The Webjet share price has been range-bound since late November. It has struggled to break above $6.20 but has found plenty of buying support about the mid-$4 mark.
Webjet shares tried and failed to break above $6.20 in November last year and again in March. They finally broke through today.
From a financial perspective, Webjet’s FY21 results pointed out that the US market is opening up the fastest. It said total transaction volumes were already at 83% of April 2019 volumes.
The WebBeds business was profitable in July and August, and is exposed to “significant upside as more markets open”, said Webjet.
The company is confident that when markets normalise, WebBeds will have “greater market share, lower costs and improved profitability”.
In addition, Webjet reported that the Webjet Online Travel Agency (OTA) was also profitable from April through to July. Despite recent lockdowns, Webject said its OTA will continue to be profitable as soon as domestic Australia reopens.